For the second time this year, an electorate has delivered a surprising result. Five months ago, the UK voted to exit the European Union. Last night American voters confounded the pollsters and elected Donald Trump. Significantly, those voters also chose to maintain Republican control of both the House and Senate. In a further surprise US stock markets rose by more than 1% today, a reaction almost as startling as the election itself.

What does this election mean to us as investors? From what we know of Donald Trump, what policies are we likely to see, and how will they affect the markets and specific stocks? The truth is we don’t know the answer, but based on the campaign and the election results, we can make some educated guesses. Below are some of the key risks and potential positives from an investment standpoint of a Trump administration.

Risks

Global trade could well be negatively affected. The TPP deal was opposed by both candidates, but Mr. Trump has called for re-writing of other trade deals as well. Trade is controversial and has affected many Americans. However, global trade generally benefits the world, and a reduction could hurt smaller economies and, in turn, our economy as well.

Immigration was a major issue for Candidate Trump, and he may follow through on some of his ideas to restrict new immigrants and possibly to evict existing illegal immigrants. The US economy as a whole benefits from immigration, and such policies could hurt US growth.

ObamaCare will likely be changed significantly or repealed. The plan that replaces it could be better, or it could be a disaster. Health care is a huge, complicated part of the economy. Any major change to it is a potential risk (and opportunity).

Everything else. Mr. Trump is a businessman, not a politician with a long track record. We simply don’t know how he will react to global threats, economic changes and the like. Markets don’t like uncertainty, and Mr. Trump brings a great deal of it.

Potential Positives

Taxes are now unlikely to rise, and there is a decent chance we will get corporate tax reform. While the deficit may grow uncomfortably, the market will probably react well to these tax changes.

Regulation will probably be curtailed. Businesses have complained for some time about the onerous oversight they get from the government, and as regulations fall corporations may feel more comfortable investing and hiring. The flip side here is that insufficient regulation could lead to negative consequences.

Mergers and acquisitions could rise as companies gain confidence the government will not stop deals (despite Mr. Trump’s opposition to the AT&T-Time Warner merger). Such deals usually come at a premium for the seller and can offer growth for the buyer, and markets generally like both. The accompanying risk is that concentration of power in fewer corporations can lead to monopoly behavior (like higher pricing), hurting consumers.

I think it’s important to remember, especially for those who dislike (or abhor) Mr. Trump, that he has been elected president, not king. There are plenty of republican lawmakers who do not agree with him on many policies, so that is a check on his power. The democrats will also be able to use Senate rules to block much of what republicans want to pass. I would also add that Mr. Trump’s upset win, in which he actually lost the popular vote, was far from a mandate. It’s not as if the American people have spoken in one voice demanding Mr. Trump’s policies be implemented. We can expect at least four years of contentious bickering in Washington, and nothing will be passed easily. In that kind of environment, there is a limit to the both the damage and the potential good Mr. Trump can do.

Overall, I believe there is probably a little more risk in the market near-term. However, we handle risk not by indiscriminate selling but by asset allocation. The money we have invested in stocks is long-term money, and Mr. Trump is just one of many politicians who will have an impact on how the market performs over that long time horizon. The money we need in the next 5-10 years isn’t invested in stocks, so that money is much more protected from downside scenarios.

In other words, my feeling is that this surprising election result doesn’t really change our investing approach. Great companies will continue to perform well over time, and at good prices we want to own those companies. While we don’t ignore the changes, political and otherwise, that happen over time, we are best served by staying focused on the long-term goal of building our wealth.